Restructuring and redundancy
There is still a lot of confusion in workplaces over how to follow a fair redundancy process or restructure. This area of law appears to be the greatest source of work for most employment lawyers at the moment, so let’s make it a bit easier! Broadly outlined below are the basic steps for an employer to follow when going through a restructure:
1. Prepare and develop the proposal: The employer needs to have a proposal which sets out the genuine business reasons why it needs to commence a restructure (a restructure can’t be used to get rid of a difficult or poor performing employee).
2. Write a letter to the affected employee(s) inviting them to meet and allowing them an opportunity to comment on the proposal: The letter needs to set out what the proposal is, why it is necessary for the business and include any supporting information and documentation. The letter also needs to outline what will happen to the affected employees if the proposal proceeds. The employees need to be informed of their rights to comment on the proposal and to bring a support person to the meeting.
3. Meet with the employee. Read through the letter drafted above outlining the proposal and provide the employee with a copy of the letter. This meeting is not the time to give feedback, but simply to emphasise that the proposal has not been finalised and that you want to meet with them and hear their feedback before any decisions are made.
4. Meet with the employee to get their feedback
5. Take the time to consider the feedback provided
6. Write a letter setting out your decision including how you have considered the employee’s feedback (whether you agree or disagree with it and why), and setting out your final decision regarding the proposal. The letter should also explain how the decision impacts on that employee’s employment and whether there are any alternative positions they could be offered or could apply for.
7. Third meeting: Meet with the employee again to provide them with the above letter and outline your decision.
This article is not intended as legal advice, but to get you thinking about the broad steps required. If you are planning a restructure, contact me for advice on the specifics.